News of the Apple Credit Card caused a sensation, but is it worth the hype?
Table of Contents
Apple, one of the leading smartphone companies in the world, announced the launch of its first-ever credit card. It became available in the summer of 2019. The announcement by Apple is expected to stiffen up competition in the credit card world. The tech giant is launching the credit card in collaboration with MasterCard and Goldman Sachs.
This is a bold step not just for the smartphone maker Apple but also for Goldman Sachs. The company is known for its investment services and is stepping into the credit card world. Keep on reading for Apple credit card review.
Apple Card is a new credit card service you can sign up for directly if you are an iPhone user. Goldman Sachs is the issuing bank, and MasterCard will make the card accessible to any establishment that already uses its network globally.
A key feature of the sign-up process is that you can use the service without a physical card. This implies that after you sign up and get approved (which would take up barely a few minutes), you can use the service. The service can be used wherever Apple Pay is accepted which is nearly 70% in the U.S. In some countries like Australia, it stands at 99%.
The new service of Apple Card comes in two forms. There is a digital part which is Apple Pay and is only on the phone; transactions can be done without a card at any vendor or website that accept Apple Pay. A tangible titanium card is also offered to be used at platforms that do not accept Apple Pay.
The titanium credit card by Apple has some unique characteristics. The physical card has only your name on the front and a strip at the back. There is no CVV number, card number or even an expiration date. This makes it more secure purely based on physical traits as compared to other cards as you do not have to worry about sensitive information being stolen if you lose the card.
This missing information on the card still exists though; it is located in your digital wallet (Apple Wallet).
The hub of the Apple Card lies within the Wallet app. This is where you can see how much you owe on your purchases when the amount due is to be paid and the exact purchases you made. If there are any discrepancies or problems, you can talk with an Apple Card representative directly.
One of the key features of the Wallet app is that it uses programming to make the transactional details more detailed and easy to understand for the average Joe. For example, the transaction names on the credit card statement (also available on the Wallet app) are names you can recognize and not just arbitrary information.
The Wallet app also performs a detailed analysis for Apple Card users whereby the app categorizes your spending, detailed information on where you spent your money and combine all that data into different categories like food and clothing. The categories are color-coded and will give you weekly and monthly reports on your spending habits.
The Wallet app makes it easier to get a comprehensive review of your spending habits without the need to log on to a separate website or app. The app makes it easier for you to spot trends in your spending habits and based on that, you can even make changes if necessary.
The app also updates you instantly when you make a purchase. This will help users pin down any suspicious activity, and the app itself will notify you if it detects any unusual transactions.
According to Apple, the Apple Card was designed to help consumers make well-informed decisions when it comes to spending and make smart choices leading to a healthier financial lifestyle.
- Numberless credit cards: Both the physical and virtual Apple Card have no numbers on them, making it harder for hackers to steal information or funds. For websites that do not facilitate Apple Pay, the Safari app or Wallet will auto-fill a number for you.
- A credit card designed for iPhone users: Customers can sign-up for the card within minutes using the Wallet app and then start using it right away. The speed of getting Apple Card is unmatched when compared to any other signup process.
- A comprehensive breakdown of spending: Apple Card gives a real-time update of all transactions and the amount owed within the Wallet app. The service uses machine learning to label each transaction with locations and names. Color-coded categories (Food, Entertainment, and Shopping) makes it easier to get a better picture.
- Smart payment tool and calculator: The service makes automated suggestions (based on your credit limit amount) on a range of payment options and the interest owed on each range. It also promotes less interest by suggesting to pay a bit more every month.
- Face ID and Touch ID: Apple Pay makes it extremely simple to use without a card; you have to use only facial recognition or Touch ID to pay for a product or service at any platform that accepts Apple pay.
When you hear about a new credit card, the first thing that pops in your mind is the premise of rewards. Apple Card has introduced the concept of Daily Cash through its service. This allows you to get daily cash on every purchase you make.
There are no limits to the amount you can get back, and the amount goes back to the Wallet app. The amount you receive can be spent on anything including websites, stores, apps, paying back on your Apple Card or even sent to a friend.
You can get 1 to 3% cash back on your daily purchases.
- 3 percent: You will get 3% of the cash on any amount spent on Apple products using Apple Card. You can purchase Apple products from anywhere–that includes an Apple store, their website, App Store or iTunes. Items include all Apple products, in-app purchases, games and even services including Apple Music, and iCloud storage.
- 2 percent: There is a 2% cash back on every purchase made using Apple Pay. That means the usage of the Apple Card through Apple Watch or iPhone will net you back 2% of the total purchase amount and is not limited to any vendor or service. Though the premise is that vendors would accept Apple Pay without a physical card.
- 1 percent: For all vendors, websites or app that do not facilitate payments through Apple Pay, the Apple Card service still gives customers 1% of their purchase amount back in Daily Cash.
During the Apple Card announcement in March and on their website, Apple has stated that it will charge interest rates ranging from 13.24% to 24.24%. The charge will depend on the credit score of the consumer.
The company has also stated that Apple Card would have no over-limit fees, no international fees, no late fees, and no annual fees, There are also no late fees associated with missed payments but if you miss a payment due date, Apple will continue to charge interest on the owed amount at your regular rate.
Apple also offers a smart payment mode which helps prevent you from paying interest by paying in advance. The smart payment option gives you suggestions on how you much interest you must pay on the outstanding balance.
Most credit cards have random due dates making it difficult to remember when each payment is due. Apple Card has a fixed due payment date which is on the last day of each month. There is also an option to set up weekly or biweekly payment schedules as well. The Wallet app also sends users a reminder of when their due date is coming up.
You will need to get approved for Apple Card just like any other credit card, and there will also be a limit to the amount of credit which will be based on your creditworthiness.
The announcement by Apple in March also carried a note on security and privacy since the company prides itself on protecting consumer data and sensitive details.
The announcement stated that each Apple Card has a unique number that is stored in the Wallet app and every purchase uses a one-time unique code that boosts the security of the card. Each payment is authorized by the Touch ID and Face ID features on an iPhone.
Apple also stated that each consumers transaction details such as what you bought, how much you bought and where is all stored within your device and not accessible to the company. The issuing bank has also agreed with Apple of not sharing consumer’s transactional records with third parties such as advertising agencies and marketers.
- Security: One of the most critical advantages Apple Card holds is that it is highly secure. Unlike other tech giants, Apple does not rely on consumer data to generate profit. From Apple Card’s perspective, it means that transactions would not be tracked. Furthermore, the physical form of the credit card contains no details except a name which makes it less vulnerable to hacking than conventional cards.
- No fees: The company has announced that the Apple Card has no fees. This means that the card users need not worry about late fees, annual fees or any hidden costs. And the card also lacks an international fee which makes it more attractive for frequent travelers.
- Daily cash back: The reward system offered by Apple Card is something truly unique; it provides cash back on every transaction without a cap on the amount. And the cash is added to the Wallet app at the end of each day.
- A comprehensive breakdown of spending: A unique feature that identifies your spending traits and sorts them into different color-coded categories. Too many greens last week? That indicates increased coffee intake. This can revolutionize not just spending habits but also might lead people to make a better decision related to money such as spending on healthy foods.
- Only for Apple users: The new credit card by Apple only comes for iPhone users. As Macs and iPads do not have the Wallet app, Apple Card is restricted to be utilized strictly by iPhone and Apple Watch users.
- Fewer perks: The Apple Card seems impressive on paper, but it is lacking many rewards that traditional credit card companies already offer such as a sign-up reward or one-year cash back matching.
- Variable interest rates: The stated range of 13.24% to 24.24% is quite a diverse range relative to other credit cards on the market. It might lead to people with a sound credit to have a higher rate.
People who shop at local convenience stores that do not have Apple Pay can expect only 1% cash back on their purchase using their Apple Card.
Other credit cards offer 2% cash back on most purchases including Citi Double Cash. The Cash Wise Card by Wells Fargo gives its holders 1.5% cash back on all purchases.
Other cards offer higher rewards in more specific areas such as Capital One Savor Card offers 4% cash back on dining, 2% on groceries and 1% for all other purchases.
Apple Card’s perfect integration with Apple Products such as the iPhone and Apple Watch makes it optimal for existing customers to choose the card. Besides, if you do not have an iPhone, you won’t be able to qualify for Apple Card.
Apple Card is a viable option for consumers looking for an everyday card to use with a simple and easy to understand rewards structure.
All things held constant, Apple Cards’ offering of cash back rewards, security features, spending reports and the credit card’s integration with the Apple ecosystem makes it highly preferable for those with iPhones to choose the service. Consumers looking only at rewards might find solace in other credit cards.Topics: Credit Cards • Financial News • Reviews